The Corporate Laws & Corporate Governance Committee of the Institute of Chartered Accountants of India (ICAI) has released a Guidance Note on Division II- Ind AS Schedule III to the Companies Act 2013.
The Companies Act, 2013 has been undergoing changes from time to time through various amendments to the Act, Rules and through notifications and circulars of the Ministry of Corporate Affairs which are issued to keep the law at par with various developments in the economic environment, regulatory requirement, policies of the country and globalization.
In the year 2015, the Ministry of Corporate Affairs notified Indian Accounting Standards thereby laying down the roadmap for companies for adoption of Ind AS. Further, MCA notified amendments to Schedule III to the Companies Act, 2013 and the format of Schedule III was termed as Division I to be complied with by Non Ind AS companies and inserted Division II- Ind AS Schedule III, which is a format of Financial Statements for companies that are required to comply with the Companies (Indian Accounting Standards) Rules, 2015.
The Guidance Note provides guidance on each of the item of the Balance Sheet, Statement of Profit and Loss, Major differences in Division I and Division II of the Schedule III to the Companies Act, 2013 besides providing Illustrative format for Standalone financial statements and Consolidated Financial Statements etc. Few illustrations have also been included with a view to provide guidance on application of the principles provided in the Guidance Note.
The Ind AS in the first phase shall be applicable to all companies, listed or unlisted, with a net worth of Rs 500 crore or more (along with their holding, subsidiary, joint venture or associate companies) and which shall be required to adopt Ind AS for accounting periods commencing on or after 1 April 2016. To facilitate the exercise of preparation of financial statements by such companies as per Ind AS Schedule III to the Companies Act, 2013, the ICAI in its endeavour has brought this Guidance Note for the benefits of its members.
Read the full text of the Guidance Note below.
